Correlation Between Molson Coors and CDW Corp
Can any of the company-specific risk be diversified away by investing in both Molson Coors and CDW Corp at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Molson Coors and CDW Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Molson Coors Brewing and CDW Corp, you can compare the effects of market volatilities on Molson Coors and CDW Corp and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Molson Coors with a short position of CDW Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Molson Coors and CDW Corp.
Diversification Opportunities for Molson Coors and CDW Corp
-0.81 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Molson and CDW is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding Molson Coors Brewing and CDW Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CDW Corp and Molson Coors is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Molson Coors Brewing are associated (or correlated) with CDW Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CDW Corp has no effect on the direction of Molson Coors i.e., Molson Coors and CDW Corp go up and down completely randomly.
Pair Corralation between Molson Coors and CDW Corp
Considering the 90-day investment horizon Molson Coors Brewing is expected to generate 0.81 times more return on investment than CDW Corp. However, Molson Coors Brewing is 1.24 times less risky than CDW Corp. It trades about 0.05 of its potential returns per unit of risk. CDW Corp is currently generating about -0.08 per unit of risk. If you would invest 5,633 in Molson Coors Brewing on September 3, 2024 and sell it today you would earn a total of 573.00 from holding Molson Coors Brewing or generate 10.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Molson Coors Brewing vs. CDW Corp
Performance |
| Timeline |
| Molson Coors Brewing |
| CDW Corp |
Molson Coors and CDW Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Molson Coors and CDW Corp
The main advantage of trading using opposite Molson Coors and CDW Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Molson Coors position performs unexpectedly, CDW Corp can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in CDW Corp will offset losses from the drop in CDW Corp's long position.| Molson Coors vs. Budweiser Brewing | Molson Coors vs. Boston Beer | Molson Coors vs. Anheuser Busch InBev SANV | Molson Coors vs. Ambev SA ADR |
| CDW Corp vs. CACI International | CDW Corp vs. Jack Henry Associates | CDW Corp vs. Broadridge Financial Solutions | CDW Corp vs. ExlService Holdings |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Fundamental Analysis module to view fundamental data based on most recent published financial statements.
Other Complementary Tools
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data |